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Revisiting the Porter hypothesis: an empirical analysis of Green innovation for the Netherlands

Year: 2016

Type: article

Abstract: Almost all empirical research that has attempted to assess the validity of the Porter hypothesis (PH) has started from reduced-form models, for example, single-equation models for estimating the contribution of environmental regulation to productivity. This paper follows a structural approach that allows testing what is known in the literature as the ‘weak’ and the ‘strong’ version of the PH. Our ‘Green Innovation’ model includes three types of eco-investments to explain differences in the incidence of two types of eco-innovation, which are allowed to affect labor productivity. We allow for complementarity between the two types of eco-innovations. Using a comprehensive panel of Dutch manufacturing firm-level data we estimate the relative importance of environmental regulations on eco-investment and eco-innovations. The results of our analysis show a strong corroboration of the weak and a nuanced corroboration of the strong version of the PH.

Source: Economics of Innovation and New Technology

DOI: 10.1080/10438599.2016.1202521

Authors: George van Leeuwen, Pierre Mohnen

Institutions: Centraal Bureau voor de Statistiek, United Nations University – Maastricht Economic and Social Research Institute on Innovation and Technology, Maastricht University

Language: English

Topic: Environmental Sustainability in Business

Subfield: Marketing

Field: Business, Management and Accounting

Domain: Social Sciences

SDGs: Industry, innovation and infrastructure, Responsible consumption and production, Decent work and economic growth

Open Access status: hybrid

OpenAlex ID: W1551316328

FWCI: 24.81

Cites: 53

Cited by: 365

Related to: 10